Public-private partnership would give the state DMV green light to research benefits, address concerns and potentially help plug $19 billion budget hole.

California may become the first state to use advertising on citizens' vehicles to help pay its bills. Although the technical details, among others, still need to be nailed down, the Golden State is looking into ad-enabled digital license plates as a way to potentially drive down the state's $19 billion deficit.

The state Assembly is considering a bill that would allow the state Department of Motor Vehicles (DMV) to start researching the use of electronic license plates to generate money for the cash-strapped state.

"State governments are facing unprecedented budget shortfalls and are actively rethinking the use of existing state assets to create new ongoing revenue opportunities," the bill's author, Sen. Curren Price, Jr., said in a press release. Cost savings could be realized through streamlined distribution, activation and registration of license plates, and would help create local jobs. "Finally, having digital electronic license plate technology developed and engineered in California would create new jobs in technology, sales/marketing and service fields."

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The digital plates would look and work like a computer screen that displays a reproduction of a license plate, with the ability to display ads when the vehicle is stopped for four seconds or longer, according to SB 1453. The state has already identified one company -- San Francisco-based Smart Plate -- that's in the development stages of producing such plates.

"Right now it's all very theoretical," said Howard Posner, Assembly Transportation Committee consultant who prepared an analysis of the bill. And it's confusing. The bill, if passed, would only offer the option for the DMV to research this technology in partnership with the private sector. And the DMV has yet to take a stance on the bill, or make any comments on it, according to a spokesman.

If it chooses to explore the use of digital plates, the DMV would be required to submit a report on its findings to the Legislature by Jan. 1, 2013. The private sector would foot the approximately $200,000 to complete the report, the bill states.

More than a Mobile Billboard

In addition to the plates' ability to display ads from companies that have entered into contracts with the DMV, they would also deliver emergency alerts, according to Price's office.

"Critical, real-time public safety information such as Amber alerts and emergency traffic updates can be broadcast to the plates during exigent circumstances," a press release from his office stated.

But California drivers wouldn't necessarily be required to turn their vehicles into mobile billboards. The digital plates would only be installed on vehicles whose owners have agreed to use them, and the owners could then choose which ads to display based on their preferences.

"It's not like you're going to be riding down the street and the DMV is going to decide to advertise McDonald's on your car," Posner said. And while the financial model is unclear, he said companies that want to advertise on license plates may offer rewards or financial incentives to the drivers who choose to carry their messages.

The digital plate would access ads from a "computing cloud" or another wireless network, as opposed to an in-vehicle or on-plate chip, the bill states. But as pointed out by Mark Bianchi, Smart Plate spokesman and company adviser, this technology is in its early stages of development.

Safety First

The state has already pointed out potential areas of concern and issues that should be addressed before such devices go out to the public.

"There are a lot of questions about how this would play out, and from our standpoint -- we're the transportation people -- we would want to